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Press Release

Half of all cotton growing regions face severe climate risks by 2040 if carbon emissions continue to soar

Climate|Medioambiental|Insurance Consulting and Technology|Investments
Climate Risk and Resilience

June 23, 2021

  • First of its kind global analysis of climate risks to cotton production published
  • By 2040, half of the world’s cotton growing regions will face drastic exposure to high temperatures, changes to water availability, and extreme weather events if carbon emissions stay high
  • Cotton 2040 initiative calls on industry actors to take urgent, interlinked action on climate adaptation as well as mitigation, with climate justice at the core.

LONDON, 23 June, 2021 — The first ever global analysis of climate risks to global cotton production reveals that runaway climate change could expose half of all global cotton growing regions to high risks from temperature increases, changes to rainfall patterns and extreme weather events by 2040. Titled “Adapting to climate change - physical risk assessment for global cotton production”, the analysis was commissioned by the Cotton 2040 initiative, which is facilitated by international sustainability non-profit Forum for the Future and supported by Laudes Foundation. The analysis was conducted by Cotton 2040 partner and climate-risk specialists Acclimatise, part of Willis Towers Watson’s Climate and Resilience Hub.

Under a worst-case climate scenario, the analysis highlights that all global cotton growing regions will be exposed to increased risk from at least one climate hazard by 2040. While this increase ranges from very low to very high risk, half of the world’s cotton growing regions will face drastic changes with high or very high-risk exposure to at least one climate hazard.

Other key findings include:

  • All six highest cotton-producing countries – India, USA, China, Brazil, Pakistan and Turkey – are exposed to increased climate risk, particularly from wildfire, drought and extreme rainfall.
  • The highest climate risk overall is projected for two regions of the world; northwestern Africa, including northern Sudan and Egypt, and western and southern Asia.
  • Some regions are set to face high or very high exposure to up to seven climate hazards
  • Cotton exposure to heat stress (defined as temperatures above 40°C) will be an increased risk across 75% of cotton growing regions, with the risk being high or very high across <5% of regions.
  • 40% of global cotton growing regions are projected to experience a decrease in growing season as temperatures increase beyond the optimum temperature range for cotton growing.
  • Water scarcity and extremes in rainfall, from insufficient in some regions to extreme and more intense in others, will present increased risk for the world’s most productive cotton growing regions. This will add extra pressure to a fibre already under scrutiny for its water footprint, affecting yields and potentially threatening to cause conflict and societal unrest.
  • Exposure to increased risk from drought will impact ~50% of cotton.
  • 20% of the world’s cotton growing regions will be exposed to increased risk from fluvial flooding by 2040, and 30% of cotton growing regions will be exposed to increased risk from landslides.
  • All cotton growing regions will be exposed to increased risk from wildfires.
  • 60% of cotton will be exposed to increased risk from damaging wind speeds, and up to 10% will be exposed to increased risk from storms.

Sally Uren, Chief Executive, Forum for the Future, said: “This analysis is a wake-up call for the cotton industry, on which much of the apparel sector is currently hugely reliant. In order to build resilience for a highly disrupted and uncertain future, the widespread shifts to sustainable forms of cotton production must be bolstered by ambitious and aligned action to reduce carbon emissions while also preparing the industry to operate in a very different world.”

However successful we are with decarbonisation, we will face decades of unavoidable climate change and disruption. Preparing today is essential if we are to limit the impacts of climate change on society.”

Alastair Baglee | Director, Corporates - Climate & Resilience Hub, Willis Towers Watson.

Alastair Baglee, Director, Corporates - Climate & Resilience Hub, Willis Towers Watson, said: “As it stands, emission reduction commitments and targets are being missed by the majority of countries, meaning that warming of more than 3°C is probable by the end of this century. However successful we are with decarbonisation, we will face decades of unavoidable climate change and disruption. Preparing today is essential if we are to limit the impacts of climate change on society.”

“Climate change impacts not just cotton but also the inter-connected agriculture system and related supply chains. In order to mitigate these risks, we need to catalyse sector-wide dialogue for proactive changes. Our partnership with Cotton 2040 accelerates this opportunity”, said Anita Chester, Head of Materials, Laudes Foundation.

Cotton has a market worth of about $12 bn1, makes up about 31% of all raw material used in the global textile market with a yearly economic impact of over $600 billion2 and supports the livelihoods of around 350 million who cultivate or process cotton. Approximately 90% of farmers grow cotton on less than 2 hectares (ha) of land and are located in developing countries, mainly in Central and West Asia, Southeast Asia, and Africa3.

The global analysis is complemented by an in-depth analysis of physical climate risks and socio-economic vulnerabilities to the cotton value chain in India. This highlights that climate impacts extend beyond direct impacts to cotton production, affecting the entire value chain, including workers involved in harvesting and processing, as well as supply chains.

Allan Williams, General Manager for R&D Investment at the Australian Cotton Research & Development Corporation, said: “Cotton growers around the globe are already feeling the impacts of climate change, with direct effects on cotton production, and knock-on effects for the wider cotton value chain. For many, the future looks uncertain. Creating a cotton sector in which people and planet can thrive will require collective, responsible action to drive climate adaptation. But it must happen in a way that ensures that cotton producers and their communities don’t get left behind.”

Phil Townsend, Senior Technical Manager - Environmental Sustainability, Primark, said: “Primark is working hard to scale up its Sustainable Cotton Programme and to accelerate decarbonisation across our supply chain. However, we recognise we need to work with the industry to drive collective action on climate adaptation – while ensuring that cotton producers and their communities don’t get left behind. The new data from Cotton 2040 helps us all to understand the climate risks to our supply chains and develop responsible responses.”

“Investing in climate justice and socio-economic resilience must be at the heart of the cotton sector’s efforts”, said Dr Uren. “Now is the time to proactively plant the seeds for the deep transformation needed to stay below 1.5°C and deliver a just, regenerative and resilient global cotton industry.”

Methodology

This study provides a high-level analysis of physical climate risks across global cotton growing regions for the 2040s under a high emission scenario (RCP 8.5, equivalent to 4.3°C warming by 2081-2100)4. This is done by using the latest, internationally recognised climate projections from an ensemble of global circulation models to capture an array of projected climate hazards. These hazards are tailored specifically to cotton’s key climate sensitivities and thresholds based on a thorough literature review and expert advice. Relative risk scores have been produced for each climate hazard, identifying cotton growing regions exposed to very low to very high climate risk relative.

The climate indicators and climate-related hazards covered were: length of the cotton growing season (effective growing degree days); heat stress; total rainfall during the cotton growing season; extreme rainfall events; long-term drought; short-term drought; fluvial flooding; coastal flooding; damaging winds; storms; wildfire; and landslides.

Access the reports, interactive Climate Risk Explorer tool supporting resources here: Acclimatise - Cotton-2040.

Additional partner quotes

Kai Hughes, Executive Director, International Cotton Advisory Council (ICAC), said: “Cotton is the world’s most widely produced natural fibre and touches all of our lives every day. And yet, the cotton sector is currently unprepared for the climate crisis, and many of the pre-existing vulnerabilities and inequalities in its supply chains are likely to be intensified and accelerated. This work by Cotton 2040 is an important step in improving the sector’s resilience and making it truly future-fit.”

Holly Browne, Principal Consultant in the Sustainable Apparel team at Anthesis Group, said: “Despite being one of the world’s leading commodities, the Cotton 2040 report reveals how unprepared the cotton industry is to react to a changing climate. To implement sustainable performance, it is imperative to unite the cotton sector and drive collective action in order to achieve climate goals which work to reduce emissions fast. Anthesis is determined to deliver change in the apparel industry by using this report to support clients in understanding their exposure to these climate risks and drive sustainable impact across resilient supply chains.”

Simon Ferrigno, author of the Inside Guide to Cotton and Sustainability 2020, said: “Addressing climate change and mitigating its impact on cotton, as this report shows, will not only help the industry meet its climate targets but will also avoid the potentially enormous impact on those who work in the cotton industry, which can also exacerbate global instability. Investing urgently in addressing climate change is a no-brainer for businesses who need dependable supplies of raw material, and for governments who surely do not want more unplanned disruptions to the global economy.”

About Cotton 2040

Convened by Forum for the Future with support from Laudes Foundation, Cotton 2040 is a multi-stakeholder initiative to facilitate the shift to a sustainable global cotton industry which is resilient in a changing climate; which uses business models that support sustainable production and livelihoods; and where sustainably produced cotton is the norm. Find out more: Forum for the future -Cotton-2040

The global analysis is made up of two reports published as part of the Cotton 2040 Climate Adaptation workstream. The two studies provide in-depth analysis of physical climate risks and socio-economic vulnerabilities to the cotton value chain in India and the U.S. Both reports, alongside an interactive climate impacts map and supporting resources are available at Acclimatise - Cotton-2040. Over the next 18 months, Cotton 2040 will bring the sector together to dive deeper into the data, understand implications and identify potential industry responses.

What is sustainable cotton?

The Cotton 2040 initiative defines sustainable cotton as follows: Sustainable cotton is grown and produced in a way that can maintain levels of production with minimal environmental impact, can support viable producer livelihoods and communities, and can do so in the face of long-term ecological constraints and socio-economic pressures.

Defining characteristics of sustainable cotton agreed on by Cotton 2040 partners (and reflected through the Delta Framework of common impact metrics) encompass social, environmental, and economic sustainability. The overarching objectives are to ensure sustainable cotton farming creates sustainable livelihoods and reduces poverty, protects and restores the environment, and promotes equality and empowerment.

About Forum for the Future

Forum for the Future is a leading international sustainability non-profit. For 25 years we’ve been working in partnership with business, governments and civil society to accelerate the transformation toward a just and regenerative future. We use our systems change and futures expertise to help tackle critical global challenges: the climate emergency, transforming our food and farming systems, and ensuring supply chains are more resilient and more equitable. We also enable long-term, transformative change by equipping individuals and organisations to act more systemically. Find out more at Forum for the future or by following @Forum4theFuture on Twitter.

About Acclimatise

Since November 2020 Acclimatise is wholly owned by leading global advisory, broking and solutions company Willis Towers Watson. The Acclimatise team is now part of Willis Towers Watson’s Climate and Resilience Hub (CRH). The CRH is a market leading centre of climate adaptation expertise, supported by the Willis Research Network, a network of more than 60 organisations in science, academia, think tanks and the private sector working to improve the understanding and quantification of risk, with the aim to improve the resilience of our clients and society as a whole.

About Willis Towers Watson

Willis Towers Watson (NASDAQ: WLTW) is a leading global advisory, broking and solutions company that helps clients around the world turn risk into a path for growth. With roots dating to 1828, Willis Towers Watson has 45,000 employees serving more than 140 countries and markets. We design and deliver solutions that manage risk, optimize benefits, cultivate talent, and expand the power of capital to protect and strengthen institutions and individuals. Our unique perspective allows us to see the critical intersections between talent, assets and ideas — the dynamic formula that drives business performance. Together, we unlock potential.

References

1 , 2 Khan, M.A., Wahid, A., Ahmad, M., Tahir, M.T., Ahmed, M., Ahmad, S. and Hasanuzzaman, M., 2020. World Cotton Production and Consumption: An Overview. In Cotton Production and Uses (pp. 1-7). Springer, Singapore. Available from: https://link.springer.com/chapter/10.1007/978-981-15-1472-2_1

3 Vivek Voora, Cristina Larrea, and Steffany Bermudez, 2020. Global Market Report: Cotton. International Institute for Sustainable Development. Available from https://www.iisd.org/system/files/publications/ssi-global-market-report-cotton.pdf

4 Collins et al., 2013. https://www.ipcc.ch/site/assets/uploads/2018/02/WG1AR5_Chapter12_FINAL.pdf Collins, M., R. Knutti, J. Arblaster, J.-L. Dufresne, T. Fichefet, P. Friedlingstein, X. Gao, W.J. Gutowski, T. Johns, G. Krinner, M. Shongwe, C. Tebaldi, A.J. Weaver and M. Wehner, 2013: Long-term Climate Change: Projections, Commitments and Irreversibility. In: Climate Change 2013: The Physical Science Basis. Contribution of Working Group I to the Fifth Assessment Report of the Intergovernmental Panel on Climate Change [Stocker, T.F., D. Qin, G.-K. Plattner, M. Tignor, S.K. Allen, J. Boschung, A. Nauels, Y. Xia, V. Bex and P.M. Midgley (eds.)]. Cambridge University Press, Cambridge, United Kingdom and New York, NY, USA.

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